'The supreme art of war is to subdue the enemy without fighting'.
Sun Tzu

6.10.2008

Desperate Households - USA

ABC News on the American Housing Disaster

June 2008This year, millions of homes in the US will be repossessed. Wall Street was aware of the risks involved with sub-prime lending but chose to ignore them. No ethics, just money- here is a story of greed and recklessness.

In California, the sub prime crisis has hit homeowners full on. Repossessions have become routine and the foreclosure rate is still accelerating. Neat façades and tidy gardens can't prevent houses being sold for almost half of what they cost a year ago. Pressed for time and money, owners are torn out of their homes: 'It's like leaving your children' says Rob. He is hoping the bank will accept a quick sale and forgive the loss, but this is unlikely. Most are made to wait until they default on repayment, which wrecks their credit record. Former bankers reveal how low interest rates were meant to boost the economy. Banks looked for ways to make profit despite low rates and chased high-risk mortgages that would pay 8 or 9%, ignoring the consequences for borrowers if prices fell and interest rates rose again: 'There's no perception of the guy in some tiny little house in Detroit or in Philadelphia or in Stockton who basically might be losing their home.' Now that the system has failed, banks are less ready to lend money and this impacts on the entire economy. Families lose their homes, businesses fail...Wall Street gambled and the world has to pay.

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Quotes

"Minds are like parachutes - they only function when open."Thomas Dewar.

Work like you don't need money, love like you've never been hurt, and dance like nobody's watching.

"Missing someone gets easier every day, because even though it is one day further from the last time you saw each other, it is one day closer to the next time you will.

"Your vision will become clear only when you can look into your own heart. Who looks outside, dreams; who looks inside, awakens."Carl Jung.

"Never give in! Never- in nothing great or small, large or petty. Never give in except to convictions of honor and good sense."Winston Churchill.

"Twenty years from now you will be more disappointed by the things you didn't do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover."Mark Twain

"Two roads diverged in a wood, and I... took the one less traveled by, and that has made all the difference." Robert Frost."